Sustainable development may ultimately be about the environment, but it is perhaps about economics first and foremost.
Electric vehicles are not new. They were first marketed in the early 1900s and then revived unsuccessfully in the 1990s. However, the situation at that time was very different: oil was cheap and abundant, and the downside costs of environmental impact largely ignored or unknown. Thus the internal combustion engine vehicle (ICEV) emerged as the dominant technology, since it was less expensive and not limited by battery capacity or recharging times. A century of infrastructural development based around the ICEV has created ‘lock in’, which has enabled the incumbent suppliers to prevent all disruptive technologies from emerging. No wonder then that nine of the ten largest corporations in the world are either oil companies or automotive manufacturers.
Time has changed and now that economies are committed to win the war against global warming, reduce foreign dependency and increase national security, industries are reconsidering the model.
Two huge industries are transforming: power and auto industries; a global new one is emerging. At crossroads of these trends, there are energy storage, smart grid, and electrified vehicle.
This vehicle electrification movement is relevant when you realize that whether the starting point is crude oil, natural gas, coal, or biomass, electric vehicles will emit fewer CO2e emissions per kilometre travelled than their conventional mechanical rivals. The business case for electric vehicle is yet hard to play with. A TCO advantage is prerequisite for the mass production of electric vehicles. With a barrel at 80-100$ and a battery cost around 240€/kWh, TCO can be attractive but to reach the scale effect of mass production, industries need:
- Strong incentive from the government,
- Bold entrepreneurship skills like those found in the Better Place project (Israel), at BYD (China) or Elektromotive (UK),
- Consumer’s behaviour change.
Within a decade, the cost of energy for a single year of fuel supply for a combustion car should cost more than the cost of energy for an electric car’s entire life. Then, the electric mobility operator can be invented somewhere between France, Israel, US, China or Denmark. The hypothetical operator would sell e-mobility mileage instead of selling car or fuel. Electric car, like mobile phone will not be driven on our road without an infrastructure to connect, sustain and recharge it. Another value chain step will be created with the huge investment required in infrastructure.
The impact will be deeply felt for utilities. Energy suppliers should decarbonise their energy supplies and add value into their electricity-fuel offer, with a subscription-based business model, including battery leasing or after sales service.
Afterwards, utilities will take into account the emerging role of hybrid and electric vehicles in personal transportation, and will integrate this into their case to build smarter grid.
Auto makers will need to integrate in their portfolio the new deal of the vehicle electrification long term trend. Competition pressure will force them to build cheaper car, with reduced vehicle maintenance, standardized to plug in different countries in the world.
Another important goal is to improve the cost and quality of battery technology. Advances in material technology, experimenting with different chemicals, and the use of nanotechnology may all play a role in this. Battery makers will need to seal global partnership with OEM’s and power companies, to move backward to ensure the raw material supply leading to a new geopolitics of resources sharing. They need to ensure the residual battery value and warranty in order to create a more credible business model.
Government will take a predominant part in this new sustainable capitalism in establishing attractive schemes to attract investment and build competitive industries. If the government makes a significant commitment to a program of electric miles, the venture-capital industry would likely respond to this signal. The overarching aim should be to develop an equivalent to Moore’s Law in battery technology, and therefore the policies framework would revolve around these topics:
- R&D of basic research regarding materials and battery chemistry,
- Preparation for validation fleet tests: to ensure durability, convenience, environmental effects in real use,
- Arrangement of codes and standards, and/or other framework to accept new type of vehicles
- Financial support of early market introduction, e.g., tax exemption according to environmental loading, support for investment to decrease financial risk
- Arrangement of infrastructure
- Public education of environmental effects for broader market
- Other incentive creation for users, to reduce barriers
- Encourage new service business regarding battery maintenance.
Extensive international partnership will be the key success factor for this emerging industry. If China decides to take on the challenge of leading the new clean electron economy on a global scale it will inevitably create massive production capacity for all critical elements of the solution: electric drive trains, batteries, EV / PHEV, charging infrastructure. Locally China will benefit from its direct central direct economy and its need to drive for change at scale due to the urgency of a country running out of fuel and cities running out of breathing air. The most likely scenario is one where China starts by both supplying the needs of its immense local market needs, but will in parallel leverage its market size and scale to create multiple massive export industries.
We are approaching the inevitable decline of oil availability. Today, countries with richer natural resources have a strategic advantage but tomorrow the geopolitical spectrum in all likelihood will change drastically. The automotive ecosystem is in the midst of significant change, with increasing challenges in consumer demands, technology development, globalization, integration and collaboration. A new era is rapidly approaching in which the very definition of personal mobility will change.
The best way to predict the future is to create it.
Certains, ce n’est pas la science qui gouverne le monde, mais l’économie et (peut être) la politique. Des solutions existent déjà, même si elles ont besoin d’être améliorées.
Le problème c’est que les métaux qui vont être utilisés pour les batteries deviendront le pétrole de demain. Le Platine ou le Palladium coûte déjà plus chère que l’or. Plus les problèmes environnementaux de leur extraction …
Les sociétés mondiales veulent des solutions mondiales, il est là le problème. Comme les laboratoires pharmaceutiques s’entêtent à chercher des blockbuster, au lieu de multiplier les « petits traitement ».
Cette démarche de standard mondiale créera forcement des pénuries. Un standard continental serai suffisant, peu d’européens vont en Chine ou aux USA avec leur voitures !
Je pense que c’est la finance qui pousse à cette globalisation par la demande de taux de croissance trop important, et cette globalisation là est inutile. On peut (on doit !) mondialisé les idées, l’économie, le droit … mais pas le matériel.
Comme pour l’énergie, c’est la multiplication des ressources et des technologies qui est la solution. Voiture électrique en ville, à hydrogène sur les plus longues distances (la plupart des couples ont déjà une voiture plus grosse pour faire les grands voyages et une plus petite, juste pour travailler) et des voitures hybrides.
“The best way to predict the future is to create it. ”
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